The Electric Car Revolution Will Soon Take to the Streets

For years, the promise and hype surrounding electric cars failed to materialize. But as this year’s Detroit auto show demonstrated, major car companies and well-funded startups — fueled by federal clean-energy funding and rapid improvement in lithium-ion batteries — are now producing electric vehicles that will soon be in showrooms. By jim motavalli

Electric cars are a green movement that is finally moving. Shunted to the side as the public indulged its love affair with gas-guzzling SUVs and four-wheel-drive trucks, history has finally caught up with the plug-in vehicle.

The North American International Auto Show in Detroit is the domestic auto industry’s biggest annual showcase, and the new models have traditionally been brought out in a son et lumière of dancing girls, deafening music, and dry ice smoke. The few green cars that made it this far were usually for display only — very few actually made it to showrooms.

Getty Images

The Tesla Model S electric vehicle at the North American International Auto Show in Detroit.

But not this year. It’s become a race to market for green cars, and soon you’ll be able to buy many of the electric vehicles that were on display last week in Detroit. The auto show featured one hybrid and battery electric car introduction after another. Although the only truly road-worthy, plug-in electric vehicle you can buy today is the $109,000 Tesla Roadster, by the end of 2010 it will be joined by such contenders as the Nissan Leaf, Coda sedan, and the Think City.

Indeed, the entire auto industry — from giants such as Ford, GM, and Renault-Nissan to startups such as Fisker Automotive — has joined the movement to build and market affordable electric vehicles.

There’s a reason the automakers in Detroit are finally plugging in as something more than a greenwashing exercise. Spurring them forward is a historic confluence of events. Chief among them are Obama administration green initiatives, including Department of Energy (DOE) loans and grants, as well as economic stimulus funds that provide $30 billion for green energy programs, tax credits for companies that invest in advanced batteries, and $2.4 billion in strategic grants to speed the adoption of new batteries. (Much of that money is going to Michigan, which despite record unemployment is emerging as something of a green jobs center.)

Other factors behind the push to manufacture electric vehicles are a federal mandate to improve fuel efficiency to an average of 35.5 miles per gallon by 2016, concerns about global warming and peak oil, and sheer technological progress building better batteries.

Even without federal largesse, some companies are moving aggressively into the electric vehicle market. A prime example: Coda Automotive, a

A key factor in making electric vehicles possible is the rapid development of lithium-ion batteries.

southern California start-up, has raised an impressive $74 million in three rounds of private funding. CEO and President Kevin Czinger is a former Goldman Sachs executive, as is co-chairman Steven Heller. Among the company’s investors are Henry M. Paulson, who was Goldman Sachs’ chairman and Treasury Secretary under the second President Bush. Clearly, these former investment bankers see electric cars as a good bet.

A key factor in making today’s electric vehicles possible is the rapid development of the energy-dense lithium-ion battery. William Clay Ford Jr., the executive chairman of the company that bears his name, told me in Detroit, “Five years ago, battery development had hit a wall, and we were pushing hydrogen hard. But now so much money and brainpower has been thrown at electrification that we’re starting to see significant improvements in batteries in a way we hadn’t anticipated. Now we have the confidence that the customer can have a good experience with batteries.”

Drawing a huge crowd, Tesla Motors Chairman and CEO Elon Musk showed off his company’s 1,000th electric Roadster at the auto show. “For a little company, it’s a huge milestone,” he told me. “A year ago, we had built only 150 cars. We had two stores then, and now it’s a dozen.”

For a major automaker, 1,000 cars would not be much to show for a year, but electric vehicles are still in their infancy. And since the electric car’s

first swan song in the 1920s — when the widespread availability of petroleum ushered in the era of the gasoline-powered car — very few start-up companies have reached the milestone of making green vehicles, especially battery-powered ones.

Here’s a look at some of the prime contenders bringing battery cars and plug-in hybrids to market:

Renault-Nissan Alliance. This is the one automaker with a truly global plug-in strategy and the means to carry it out. Under the Nissan banner, the company will deploy the Leaf battery sedan, with 100-mile, all-electric range. Nissan isn’t just dumping its sleek entry into the market — it’s also building a home charger with new partner AeroVironment and partnering with local, state and federal governments — both in the U.S. and abroad — on public charging stations. In partnership with Better Place, the company will deploy a second Renault electric vehicle as part of its plan to wire up Israel with charging stations for electric cars. Renault-Nissan chief Carlos Ghosn predicts that electric vehicles could constitute 10 percent of world car sales by 2020.

Ford Motor Company. Ford’s green strategy includes a plug-in version of the new Focus for 2011 and a “next-generation” hybrid — based on its global compact-car platform, or C-platform — in 2012. The company announced in Detroit that it would invest $450 million in Michigan as part of its electrification strategy. Michigan Governor Jennifer Granholm told me at the auto show that until recently the state “wasn’t sure it had a viable auto industry.” Today, she said, the state is enjoying $1 billion in new auto-related investment, much of it jump-started by a combination of federal funding and state tax credits.

General Motors. GM’s big news is the Chevrolet Volt, which has definitely helped the company’s image. The Volt, which uses a small gas engine to generate electricity for its electric motor, is a lot of fun to drive if the version I drove recently in Michigan is any indication. Until now, GM has stumbled in its hybrid strategy, and it really needs this car — which will go on sale at the end of the year for a hefty $40,000 — to be a hit. But success may be more a matter of perception than actual sales. “In terms of numbers, the Volt will be pretty small for the first couple of years,” says product chief Bob Lutz. A Cadillac version of the Volt is also a possibility.

Tesla Motors. This California start-up launched at the top of the market with its $109,000 Roadster, which combines sexy looks with supercar performance (zero to 60 in 3.9 seconds). The company is on something of a roll, having sold 10 percent of itself to Daimler for $50 million, and landed $465 million in DOE funding for its forthcoming Model S sedan — a Maserati-like, more practical version of the Roadster. Tesla’s Musk says that the company’s strategy has always been to use its sale of performance cars to finance its third vehicle, a mass-market electric vehicle. The company is currently looking at California locations for a Model S factory.

Fisker Automotive. Perhaps Tesla’s closest competitor when it comes to glamour electric vehicles, Fisker – whose CEO is Danish-born automotive designer Henrik Fisker — is preparing to debut a high-performance plug-in hybrid (zero to 60 in 5.8 seconds, with 67 mpg fuel efficiency) known as the Karma at the end of the year. Al Gore is on the waiting list. Fisker also has a lower-cost car in the wings, called Project Nina. Fisker won $528 million from the DOE to build the Nina in a former GM factory in Delaware.

Coda Automotive. This start-up will deliver, in late 2010, a small battery-powered sedan with batteries from its own joint venture in China. The car is based on the Saibao, a Chinese car, but Coda has put a host of western companies to work honing an

Electric vehicles will be built in hard-hit Elkhart, Indiana, once the ‘the RV Capital of the World.’

electric drivetrain for it. “A large part of our mission is to accelerate adoption of all-electric vehicles,” Coda CEO Kevin Czinger told me. “We have put together a core group of auto and battery engineers, and are leveraging specialty automotive firms that we think can get us to the right price point.” Coda will launch with an Internet marketing strategy in California only, but it will have the capacity to produce 20,000 cars a year.

Think Global. Think is a survivor, with perhaps the longest and most colorful history among green automakers. It is a Norwegian company that attracted Ford Motor Company investment in the late 1990s with its plastic-bodied City commuter car. Ford sold the company in 2003 and it went through bankruptcy proceedings in late 2008. It has since emerged under the partial ownership of U.S. battery company Ener1, which snagged $118 million in DOE funding to expand its battery production in Indiana. Think electric vehicles will also be built there starting in 2011, in hard-hit Elkhart — once proudly known as the “RV Capital of the World” — and now suffering the effects of the recession. The two-seat Think City (with approximately 100-mile range on lithium-ion batteries) will sell for less than $20,000 in the U.S., but that price does not include the leased battery pack and includes the $7,500 federal tax credit for electric vehicles.

The list of players in the electric vehicle race goes on. Toyota is building

More from Yale e360

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Electric Car RevolutionThe potential for electric vehicles has been talked about for decades. But a former Israeli software entrepreneur is developing a game-changing infrastructure that could finally make them feasible.

Revenge of the Electric CarAfter years of false starts and failures, the electric car may finally be poised to go big-time. With automakers from GM to Chrysler to Nissan preparing to roll out new plug-in hybrids or all-electric models, it looks like the transition from gasoline to electricity is now irreversible.

plug-in hybrids and fuel-cell vehicles, and showed off a small cousin of the Prius in Detroit. Chrysler has an ambitious electric vehicle rollout that’s been stalled by the company’s bankruptcy and merger with Fiat. Honda continues to deploy clever hybrid cars, including the upcoming two-seat CR-Z it showed in Detroit. BMW has electrified the Mini for a test program, and has similar intentions for the Concept ActiveE, a plug-in version of the Series 1 BMW coupe. And Audi has shown sudden interest in this segment, debuting the second of its electric e-tron vehicles.

By this time next year, electric cars will no longer be just on auto show stands, but will have arrived in showrooms at last.

ABOUT THE AUTHOR

Jim Motavalli is a contributor to the New York Times, CBS Interactive, The Daily Green, and the Mother Nature Network. He is the author of Forward Drive and a forthcoming second book about green cars. In a previous article for Yale Environment 360, he wrote about efforts to build a network of charging stations for electric vehicles.MORE BY THIS AUTHOR

COMMENTS

Although I think this was a great article, the opening paragraph about how people love their gas guzzling SUV's etc is way off the mark.

May I suggest anyone who truly wants to know why we are still driving around vehicles that are not electric view the documentary "Who Killed the Electric Car." It's well founded that the industry itself put a squash on the electric car, not consumers. The movie can be seen for free at You Tube.

Rapid mass adoption of electric car technology is going to have rapid mass impacts on the markets for electricity though, isn't it? There's a disconnect between how quickly you can ramp up consumption of those vehicles and how quickly you can ramp up supply of electricity -- something that is planned on a decadal scale. Is someone out there doing the projections?

One of the cheapest quickest ways to get more electricity supply is to build coal-fired plants. How does that trade-off pan out? From a climate change perspective are we better off with coal-powered cars than with petroleum-powered ones?

Posted by
Aaron Cosbey
on 21 Jan 2010

Interesting point, Aaron.

I think the jump in venture capital that is funding green tech companies this year shows that we will see huge strides in windmill and solar power generation very soon. Wind power capacity jumped 50 percent last year to over 25 gigawatts in the US alone, making the nation the world’s top producer of wind power, we are seeing a similar situaton in the solar farm industry.

I would just hope that green energy grows faster then the increase for electricity grows.

The sale of electric cars to those who can afford them is commonly held to be highly benign in reducing greenhouse gas emissions [GHGs].

In reality, that view is a delusion. The petrol that these vehicles will avoid burning will be bought and burned by other people, mostly abroad, at a marginally lower price than it would have made without the electric vehicles' intervention. [Only a global treaty setting binding national caps on GHG emissions can constrain the global trade in fossil fuels].

In addition to this 'status quo' GHG output is that of the power plants supplying the electric vehicles' batteries. Given the small fraction of US power that is neither fossil-fired (including nuclear fission) nor mega-hydro sourced (with its damaging methane emissions) it is reasonable to suppose that the additional power demand from evs' mass-sales would ensure that fewer coal-power plants would close in the coming decades, thus obstructing GHG cuts.

Given the looming impact of Peak Oil supply on the affordability and availability of petrol in the coming years, there is a serious question whether electric vehicles are really a means to reduce GHG emissions, or whether they are actually just a means to keep driving affordable for more people.

Why, why, why do we think this is something new? I spent my summers in the Los Angeles area from 1986 to 1996 and saw all electric Rav4s plugged in at the Aquarium of the Pacific.

The post above by Kristin is right on point. We've had this technology for years and it has been squashed. There is no reason why an electric vehicle should cost $100K!

I am glad to see it has come full circle, but think how far we could have come had we not had to reinvent the wheel.

Posted by
Kelly Wenzel
on 21 Jan 2010

Why not use this type of technology, instead of building the projected two billion cars, primarily for building (or rebuilding in the US) urban rail so the world does not have to suffer all the material constraints and mining operations, costs of traffic jams and other inefficiencies of a private vehicle transportation system, especially for commuting? Over forty thousand die on our roads each year and many more are injured.

We could have some electric delivery trucks and a limited number of cars, but I see national rail freight and passenger service along with vibrant urban transit as more resource efficient and fun. Rent a car once in a while when you need to go fast or "off the beaten path." What country are we going to tear up now for all these materials, like lithium?

Posted by
James Newberry
on 21 Jan 2010

Great article. However, Jim didn't mention another global electric car player - Mitsubishi.

Mitsubishi is increasing production of its i-MiEV electric car by 20 percent from an original plan for fiscal 2010 to 8,500 vehicles.

It has sold more than 1,500 units to corporate customers in Japan and will also start selling its i-MiEV electric car to individuals from April 2010. Mitsubishi will start selling the i-MiEV in Europe through Peugeot Citroen PSA, and will also start exporting i-MiEV electric cars to the U.S. in fiscal 2011, leading to a further increase in production.

Excellent points brought by James and Lewis. This whole electric car hype seems to me a way to keep the "American way of life" (i.e. of consuming) intact by allowing people to keep driving for cheap, while sidelining the mainstreaming of public transit or biking as a means of everyday transportation.

The mechanism Lewis describes is I believe an application of what some call the rebound effect: if you cut on the use of a polluting resource in one sector, it will lower overall demand for the resource and make it cheaper for other sectors to use it, thus only displacing demand and not reducing it. That's why the overall consumption of oil (and associated emissions) might not be affected at all by the replacement of petroleum cars by electric cars.

However, one thing that will be affected is the profits of the companies who produce these new cars. They get the "green" subsidies from the government to reduce production costs, and will also get all these new sales from people who believe they will do a good action by going electric.

I believe an application of Jevon's paradox (see www.theoildrum.com/node/6116).

Lewis Cleverdon
James Newberry

Posted by
jps
on 26 Jan 2010

I am very in tune with the above article. I have had the opportunity to spend a little time in these new technology rides. I am still amazed at how quiet they are from idle to acceleration. I have found them to be very effective from stop light to stop light. The issue remains in my mind about the practicality and longevity of the battery's and running gear. How costly are they to fix and where will we service them outside of the dealerships of course.

My exposure to these greenies is based on my contract with one of the larger companies. We get to ship truck loads of there version of the "green car" from the research department to the testing areas. We have noticed that they are considerably lighter and much easier to move around on the trucks versus the gasoline counterparts.

Posted by
Fred Cerrato
on 28 Feb 2010

I would just hope that green energy grows faster then the increase for electricity grows.

Posted by
chris
on 09 Jul 2010

In hybrid venicles there is a gas or deisel backup power. I wonder if an on-board refillagle bladder of compressed air substitute for the gas or deisel fuel backup. It would be used to recharge an expanded batter array and service stations would dispense the air - or a home recharge station with solar or wind power source (or electric)? On board accessories would also draw on the compressed air. Perhaps vehicle weight could be reduced (engine weight subtracted) Government subsidies might be available. It is necessary to evaluate power in and out and storage capacity. This may be a new concept to explore.

Posted by
david mcaleese
on 15 Jul 2010

As for the demand increase for electricity.. it could easily be at least partially offset and met by currentexcess windpower production.

Posted by
Jayson
on 13 Sep 2010

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